Largest Holdings
Diamondback returned about 6 percent this year through yesterday and an annualized 9.1 percent since its June 2005 inception, according to a person with knowledge of the returns who asked not to be named because the information is private.
Hedge funds gained an average 1.8 percent this year through November, according to data compiled by Bloomberg. The Standard & Poor’s 500 Index returned 15 percent in the period.
Diamondback held about 2 percent of US Airways Group and Take-Two Interactive Software Inc. as of Sept. 30, according to regulatory filings. Its largest U.S. stock holdings were Yahoo! Inc., Capital One Financial Corp. and American International Group Inc.
The hedge fund has already started selling its investments, according to the letter.
Schimel and Sapanski started Diamondback with Chad Loweth, who left the fund in 2010. They all previously worked at billionaire Steven A. Cohen’s hedge fund, SAC Capital Advisors LP. Schimel is married to Cohen sister.
Cohen’s SAC
Cohen was last month linked for the first time to transactions at the center of an insider trading case when prosecutors said he sold shares in two drug companies based on the advice of Mathew Martoma. Martoma, a former portfolio manager at a unit of SAC, was arrested Nov. 20 in what court documents described as the “most lucrative” insider-trading case ever uncovered.
Cohen hasn’t been accused of wrongdoing. His spokesman, Jonathan Gasthalter, said last month that Cohen and SAC are confident they acted appropriately and will continue to cooperate with the government’s inquiry. Charles Stillman, a lawyer for Martoma, said last month he expects his client to be fully exonerated.
The U.S. Securities and Exchange Commission told SAC, which manages $14 billion, that it is considering pursuing civil fraud claims against the fund related to the alleged insider trading, three people with knowledge of the matter said last week.